Happy Halloween! Theranos appeared in a Pfizer costume

Today we learned more about Theranos’ kink for corporate cosplay. The company liked to embellish its own reports in the logos of pharmaceutical companies, to use the present when future time would be more appropriate, and to repeat its favorite buzzwords in PowerPoint slides after PowerPoint slides.

Elizabeth Holmes’ lawyers, to defend her against the allegations of electronic fraud raised by the government, resumed the cross-examination of Lisa Peterson, who worked for DeVo’s family offices and was involved in approving their investment in the company. (Family offices are a thing for rich people – an investment arm for all the sweet, sweet money.) The defense tried to discredit Peterson’s testimony last week about an important Pfizer memo, which she said was the key to believing the company was on its way to something big.

The only problem? Pfizer did not write it. A former scientist at the company testified that Theranos changed a report that the blood test startup had made to include the unauthorized use of the Pfizer logo. Pfizer’s actual findings were that Theranos’ conclusions in this report were “not credible,” the former Pfizer scientist had testified. But Peterson did not know it and had relied on the note as a real validation.

Homes defense attorney Lance Wade pointed out that Theranos’ physical address and website were at the bottom of the Pfizer memo, in the footer. The footer text was significantly smaller than the Pfizer logo at the top of the page, suggesting the relative importance of each piece of information.

When the prosecution got a chance to talk to Peterson again, they asked her if the footer information would have convinced her that the note was not from Pfizer. No, she said – the logo on the top was large. When she and her colleagues were considering an investment, “we really rested on the fact that they had been working for pharmaceutical companies and the government for years,” she said.

That’s how we ended up talking about verbs. After establishing that Peterson knows what the future holds, the prosecution went through some Theranos slides. “Therano’s proprietary technology runs extensive blood tests from a finger stick,” one read. “Runs” are present and indicate that the tests are currently happens.

In fact, we ran through several slides to discuss verbs – all of which were present or past, not future. During the cross-examination, Wade had returned to an idea he had hovered earlier in the trial: that the investors in Theranos were sophisticated and that they had even signed papers saying that Theranos was a speculative investment. The implication seemed to be that Theranos was not insidious – Peterson was just sloppy, and Theranos promised what it would do in the future.

But the language of the presentation undermined that idea. Somewhere a grammarian rejoiced.

After Peterson left the stand, we were treated to several Big Pharma testimonies, this time from Constance Cullen, who worked at Schering-Plow, which was then acquired by Merck. In 2009, Cullen’s boss had asked her to evaluate Theranos’ technology. In the process of doing so, Cullen met with Holmes and other people on Theranos, but it seems that Holmes was talking everything. “On a couple of occasions, I tried to ask questions to other Theranos employees at the meeting, and the answer was interrupted by Ms. Holmes,” Cullen testified.

During the meeting, Cullen said she found Holmes’ answer to technical questions “cagey.” Originally, there was supposed to be validation data at that meeting, but it was actually only provided by Theranos in December 2009 – and since Theranos was the party that performed the validation surveys, only Theranos’ logo appeared on the report. Neither she nor anyone else at Schering-Plow said its conclusions were accurate, she testified.

Things were hectic for Cullen when Merck had just acquired her business and she now led a larger team. She postponed the discussion of the report and did not return to it.

Still, Theranos approached Walgreens in 2010 with a version of this validation report. This the version had the Schering-Plow logo on top. In an email accompanying the report, Holmes wrote: “According to our discussion, please find three independent due diligence reports on Theranos systems attached to this email. These reports are from GlaxoSmithKlein, Pfizer and Schering-Plow after their own technical validation and experience with Theranos Systems in the field. “

The new version of the report had a new conclusion. While the original version said that Theranos devices “give accurate and precise results”, the new logo report said that Theranos devices “give more accurate and precise results … than the current” gold standard “reference methods.Schering-Plow had not approved the old language; it had certainly not approved the new language – Theranos had written both versions of the report. Schering-Plow had not responded to the original in any way and was probably unaware of … let’s say improved version.

The memos and slideshows reappeared in the testimony of Daniel Mosley, who invested “just under $ 6 million” in Theranos after his buddy Henry Kissinger, a Theranos board member, asked him to evaluate the company.

Like Peterson, Mosley was won over for the work Theranos said it had done with the government and major pharmaceutical companies. In the note that Mosley wrote to Kissinger, he seemed very impressed with the note that did not come from Pfizer, and he even devoted quite a bit of his own note to its results. It wasn’t just the logo that made him believe Pfizer was behind the report; the conclusions sound as if they were from a third party, he testified.

Mosley also believed that all Theranos tests were performed with fingerprints, mainly because of the materials that Theranos provided him with. We saw a Theranos-generated slide of a child with the text “Goodbye, big bad needle” and another that read “Our certified laboratories perform accurate tests on a sample that is 1 / 1,000 the size of a typical blood sample. None large vials to fill. no longer to look for a vein. ”

At times, Mosley’s testimony felt like a living reading of the social register. He had worked at a famous and fancy law firm, Cravath, where his job was to advise rich people on how to stay rich. Some of his clients invested in Theranos – the DeVos family had $ 100 million; The Walmart heirs, Waltons, had $ 150 million; The Cox family invested $ 10 million of its cable assets; and Kissinger’s trust was worth $ 3 million. Andreas Dracopolous of the Stavros Niarchos Foundation pledged $ 25 million, and John Elkann of the Ferrari-owned family invested $ 5 million.

The testimony put Mosley at the center of a group of extremely rich and influential people, but as if to drive home to that point, we saw an email from him to Holmes. The day after talking to her for the first time, he offered to introduce her to the Walton family. Then he followed up: “Rob Walton ran into one of your board members this weekend at Grove.”

I’m not sure which board member this was – the testimony did not specify – but by “the Grove” Mosley meant the ultra-exclusive boys’ club The Bohemian Grove. Unfortunately, he did not get into the strange naked rituals or anything else of interest to us plebeians.

With Mosley, as with Peterson, the defense seemed to suggest that Theranos investors were simply vague – rich, boring and unable to check up on the things they poured their money into. But between the language Theranos used in his presentations, its custom memos that were not actually from pharmaceutical companies, and its continuing emphasis on its testing being faster and better than anything else, it seems obvious that Theranos wished its investors to believe the hype. Just because someone is sloppy does not make it okay to try to fool them.

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